This video, from my current favourite English economic commentator, may well interest you over a coffee break.
Education
YAP – (IMPORTANT) – a cautionary tale at a time of peak political risk for markets
Below is CoPilot’s succinct summary of some recent economic history in Turkey:
When the Turkish government asserted greater control over the Central Bank—particularly under President Erdoğan’s leadership—it triggered a cascade of economic consequences that reshaped the country’s financial landscape:
📉 Unorthodox Monetary Policy
- The government pushed a controversial belief that lower interest rates would reduce inflation, defying conventional economic wisdom.
- Between late 2021 and early 2022, interest rates were slashed from 19% to 14%, despite rising inflation.
💸 Currency Collapse & Inflation Surge
- The Turkish lira plummeted, losing over half its value in months—dropping from 8.30 to over 18.30 per USD.
- Inflation skyrocketed, peaking above 80% by mid-2022, far exceeding the official targets.
🏦 Investor Confidence Eroded
- The central bank’s perceived lack of independence led to capital flight and depleted reserves.
- Political interference—especially after the arrest of opposition figures—further rattled markets.
🔄 Policy Reversal & Lingering Damage
- After the 2023 elections, the government signaled a return to orthodox monetary policy, raising interest rates to 50% by early 2024.
- Despite this, inflation remained stubbornly high at 37.9% as of April 2025, with expectations poorly anchored.
🧮 Manipulation Allegations
- Critics accused the government of manipulating official inflation data to downplay the real cost of living.
In short, Turkey’s experiment with politicized central banking became a cautionary tale: when monetary policy is driven by political goals rather than economic fundamentals, the fallout can be swift and severe.
A repeat in the USA? This week?!
At the Whiteboard – Assessing Fund Performance
I noted when reading the material about portfolio reviews which I reminded you about at the start of the month that I had not, in fact, published a promised follow up with guidance on reviewing portfolio holdings that were not performing as expected.
This is an important exercise but one that depends to a degree on experience and some applied knowledge of what actually influences portfolio outcomes. A comprehensive retelling of all the data I would want to look at and how I would interpret it all would make for a very long piece indeed. That was not what I promised!
I have instead made a 17 minute video that suggests one technique that allows one fund to be scored against another, the seond in effect serving as a benchmark. After all, if you sell out of a fund, then you usually want to invest in something else.
[Read more…] about At the Whiteboard – Assessing Fund PerformanceSeptember 2025 – Back to school!
Introduction – Pick and Mix Revision
This month, I don’t have anything interesting to write about in the style of the Deep Dive longer articles that I usually start the month with, so I am allowing you a choice as to how much time you spend on your investment portfolio management education. I thought it would be useful to offer what might be taken as a revision list or a prompt to put in place some processes that make sure you are continually and effectively on top of your portfolio.
Because I have written and published on this web site a great deal of material and some very specific guidance on the various essential aspects of portfolio maintenance, much of what I would like you to review will be referenced by links to articles of various lengths.
You can decide exactly how much you want/need to take in as your personal refresher course and then reference the relevant articles, spreading the readings over a few sessions if you prefer.
Not everything that I currently think is important is already on record, so the second part of this month’s briefing does add some new suggestions.
New video – update on private equity access for retail investors
From midnight tonight, August 11th 2025, a short new podcast style video will go live. Here is the link:
Deep Dive – August 2025
Introduction – European Focus
This month’s longer post is dedicated to the outlook for European (including the UK) markets for the rest of the year, based partly on the Morningstar webinar presented a couple of weeks back, from which I have extracted and in some cases further interpreted or extrapolated, my own selection of important pointers and data.
Note that the presentation was delivered just before Trump’s threat of 30% tariffs on the EU if a trade deal had not been struck by the end of July. As I wrote this piece, an outline deal had been announced, with a general tariff set at 15% but various significant issues still outstanding.
The main webinar presenter , Michael Field, Chief Equity Strategist at Morningstar Europe, did (in mid July) make the point that a ‘blow up’ in trade relations with the USA was a distinct possibility! I think the outline deal that we know about as I write this piece is being taken, or at least presented, differently in the various major European states, but perhaps the provisional outcome is not so much a ‘blow up’ as a potential set of hurdles that will impact trade in ways yet to be fully understood, possibly only temporarily.